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2024 (4) TMI 423 - AT - Income TaxBogus LTCG on shares - unexplained credit u/s 68 - HELD THAT:- Only finding of the Ld. AO that the investor’s share capital and reserves were not changed from the preceding year also there is insufficient income cannot be the sole reason to characterize the said transaction as bogus and to disqualify the same under the provisions of Section 68 for making an addition. In the present case, the assessee had cooperated with the department have produced all the necessary information, including the production of the director of the investor company, before the ld. AO; therefore, the burden cast on the assessee has been duly discharged. Ld. CIT(A) has also observed, and rightly so, that there was no reasonable basis supported by any material on record with the Ld. AO to disprove, the identity and creditworthiness of the investor, i.e., M/s Axis Propbuild Private Limited, and the genuineness of the transaction. We hold that the addition made by the AO was merely on the basis of a preconceived notion, arbitrary, and unsustainable; therefore, the finding of CIT(A) that since the identity and creditworthiness of the investor as well as the genuineness of the transaction is duly established, therefore, in absence of any further explanation, evidence, material, or decision to dislodge such finding of the CIT(A) by the revenue, we do not find any infirmity in the said findings so as to interfere with the same. In result, Ground No. 1 of the appeal of the revenue dismissed.
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